Putting money down on a lease



Does it ever make sense to put money down on a lease if you intend to buy the car at the lease end?


No if you intend to buy just buy it upfront.


Been discussed before… here’s a hand:

There are more threads about buying out vehicles at lease-end. A quick search will turn up a lot. GLWT


The residual value at the end of the lease is the same, no matter what you do, how much you put down, etc.


I’ll say it again, you’re keeping the overall cost of the car the same, just paying more of the lease upfront, then paying the same set residual value at the end. You’re not saving any money, or saving any on interest.

If you are going to purchase the car at the end, just buy it new, however, some people may object to your vehicle choice of a Mazda CX5.

The added bonus is that if you total the car sooner than later, you lose all the :moneybag:

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The odds of totaling your vehicle during the term of a 2-3 year lease are extremely remote.

If the money factor is 0 (or nearly 0), of course, there is no point in taking on the risk.

If the MF > 0 then you should calculate the potential savings in finance costs, and then make a decision based on your own risk tolerance.

Just like totaling your next vehicle, the events shown below could happen to you, but you probably don’t make your decisions as if they were likely.

I think there are more arguments against a big cap cost reduction than just the total lost. There’s the inconvenience if you try to transfer of potentially have recouping any money, there’s the psychological side that many fall into about having a lower monthly, there’s the time value of money up front, there’s higher returns one could hopefully make in other investments, there’s the benefits of just having more liquid capital at a very low rate, etc.

Now, those are all going to be dependent on personal situations, but at the very low rates most cars are available at these days, it is hard to justify putting a big cap cost reduction.


There are also tax reasons for a down payment for a company vehicle. If you need more write offs this year more than next year.

All valid points. I was addressing the “if you total the car” comments specifically, which are generally presented here without regard to the actual risk.

Max-out the MSDs instead.

Nope. Sometimes there are extra incentives on a lease compared to a purchase where it is a better decision to lease first and then buy it out.


You can do both, and MSDs are not always possible.

I have to humbly disagree, but would like to see an example were leasing first is better then just buying outright?

Kia stinger is the only one I can think of.

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Off the top of my head, when the Stinger first came out, there were a lot of lease incentives that didn’t apply to purchases.

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If you don’t like the car after 2/3 years of use, you can just walk away.

So your referencing a single make of a vehicle from its launch? come on now your better than that…And hershey beat you Hahaha

You do that on a purchase as well if you negotiate the right way.

Lmao stop taking it personally. All I’m saying is to do your research before assuming that buying rather than lease to buy is automatically the better option.